China’s tax authorities have launched an investigation against Taiwan-based iPhone maker and supplier Foxconn. As part of this, tax officials raided Foxconn’s offices in two Chinese provinces, reported China’s state-run Global Times. However, Chinese authorities have not officially said anything about the investigation against Foxconn. On the other hand, Foxconn said, they will provide the necessary cooperation in the investigation. Analysts say that China’s decision may be politically motivated.
The Global Times reported that many people in Taiwan suspect that Foxconn is being investigated because Terry Gou is running for president. But some think that China has started an investigation targeting the US Company Apple as a counter strike in the trade war.
The company’s share price fell 2 percent on Monday after the news against Foxconn. On the other hand, shares of Apple fell about 1 percent in pre-market trading.
Reuters reported that Foxconn founder Terry Gou has recently announced that he will run as an independent candidate in the presidential election to be held in Taiwan next January. In that statement, Terry sought to prevent Taiwan from becoming the ‘next Ukraine’ through presidential elections. But less than two months after the incident, China started an investigation against his company.
Foxconn is one of the largest suppliers of iPhones made by US Company Apple. The company said it is a fundamental principle of legal compliance wherever they operate around the world. In the statement, the company said, ‘Here too we will actively cooperate with the relevant departments of the government.’